The settlement still requires judge’s approval in San Francisco's federal court.
In the suit, the plaintiffs contended that Apple's water contact indicator tape – which changes colors based on the extent of the water damage, failed to differentiate between whether the device's inability to function properly was due to water damage or an unrelated malfunction within the device.

Additionally, the tape's manufacturer – 3M, said that its tape could turn pink merely with humidity and not direct contact with a liquid, according to the plaintiffs.

In response, Apple contested 3M’s results stating that the tests were conducted on indicator tape open to the elements, and not contained inside a device, and at unrealistic extremes of temperature and humidity, IDG News Service reported.

As of November 2009 and May 2010, iPhone and iPod touch customers respectively had their policies changed to exclude coverage for "liquid spill or submersion" or "abuse."

Those eligible for settlement funds include iPhones customers denied coverage before Dec. 31, 2009 due to the company's liquid damage policy, and iPod touch customers who were denied coverage before June 30, 2010.

Attorneys’ fees and reimbursement of litigation expenses reportedly amount to up to 30 percent of the proceeds.